When Carousell broke the news about its $56 million fundraising deal with OLX Group, it was much needed relief for the Singaporean online classifieds company. Carousell had been holding on to the announcement for three whole months. OLX’s parent company, Naspers was experiencing “delays” back in South Africa, forcing Carousell to wait it out.
But that was last week. Work for Carousell begins in earnest – right now.
Its $56-million handshake involves acquiring OLX’s operations in the Philippines, a new and highly strategic market for the online classifieds firm.
“With OLX Philippines, we’re welcoming 6 million users which they’ve built up over 13 years, and it accelerates our progress into a market that is strategically important. The Philippines is the second largest market in Southeast Asia by population, with over 100 million people that we can serve,” said Quek Siu Rui, CEO and co-founder of Carousell.
The next two quarters will be focused on integrating the Philippines venture into the fold. It is Carousell’s seventh market alongside Singapore, Hong Kong, Taiwan, Indonesia, Malaysia and Australia.
Carousell will also focus on priming Hong Kong and Singapore towards greater monetisation and profitability over the next two quarters.
“Singapore and Hong Kong are near-term monetisation opportunities (for Carousell), and these markets alone will be the ones that can offer long-term viability for long term markets…We truly believe that they can be immensely profitable in the next 2 to 3 years. That will help us play in the rest of Southeast Asia.”
Carousell will also roll out its car marketplace service in Hong Kong over the next two quarters – a service that is currently only available in its home market, Singapore.
Quek did not disclose how much operational runway Carousell has with the new funding, but said that it is “well capitalised for the next few years”.
Carousell generates revenue from three streams: online advertising, where it partners with brands and merchants to sell; premium visibility like Bumps and Spotlight, where it charges sellers to increase customer reach; and Carousell Pro, a subscription service where it partners car dealers and real estate agents to list their ads.
Quek shared that its revenues are ‘evenly split’ across all three streams and has generated its first full year of monetisation in 2018. He noted however, that these are still in the very early stages.
“We have investors who support our long-term vision, and now we’re focused on executing against that long term vision…We’re also very financially disciplined as an organisation and confident about our growth prospects overall,” said Quek.
Edited interview excerpts with Quek Siu Rui, CEO and co-founder of Carousell: